When inflation isn’t.

In my previous post, I cited the rise of ammunition and restaurant meal prices as examples of inflation. That wasn’t the whole story. Inflation is what happens when the amount of money in circulation increases faster than the supply of goods and services. The price increases we are seeing are only partially explained by inflation.

The cost of ammunition is also affected by government efforts to artificially reduce availability. The same government efforts raised prices of guns, magazine and other defensive tools. At the same time, the popularity of those items increase because federal and state governments are increasing looking and acting as sociopathic predators and individuals reasonably try to secure defenses against them.

The cost of restaurant meals is affected by government efforts to mandate employee compensation, rules and regulations of every minute details of business, increasing the direct and indirect costs to restaurants and their suppliers. The situation is so bad that certain friends actually closed their US businesses and plan to move to countries with better business climate (which according to them includes Singapore and Taiwan).

So the rise in prices isn’t just inflation — though that’s bad enough in itself — but also the costs imposed by social engineering.

6 Responses to When inflation isn’t.

Typically inflation shows up first in commodities and works it’s way through the economy. Most of the increase in the price of gasoline over the last 4 years is from inflation. The same with food, both of which are conveniently left out of the CPI calculations. Because no one has to eat or drive to work, you know.

It depends how you define “inflation”. Monetary inflation is when the supply of money increases faster than the value of goods and services. Price inflation is a result of monetary inflation, regulation, and other external cost factors.

There is also supply inflation, where costs go up because there’s more to buy. For instance, the cost of telephone devices and services may be falling, but our phone bill keeps going up because there are more gadgets and services included on it. We’re spending more on health care for the same reason.